Student Debt

Vero Beach CPA, Titusville CPA, Accounting services Vero BeachSince the year 2000, the number of students who took out loans to pay for their education rose to 42 million. The dollar amount is now approaching 1.1 trillion dollars. It is believed that the recession caused more students to borrow than would have normally.In all probability it was also because the job opportunities were scarce, competition for the available jobs was higher, and it caused people who might normally have attended community or state schools to seek an education at more prestigious schools.

Unfortunately, for many of those borrowers, the more expensive education did not lead to better opportunities, and the jobs they hoped for a just now beginning to materialize. The amount of student debt these young people are carrying is eating up any financial advantage, at least for the time being.

There are proposals in the Congress which if passed would allow these borrowers to have the option of re-financing some or all of their debt to lower interest rates and better terms.

If your children are getting ready to apply for college, before they pick a for profit, expensive university, sit down and calculate the costs with them. Try to make sure they understand how long it will take to pay back the money they borrow. And if you can, research the average salary of the career they are getting this education for, and see how well it will pay.

And perhaps remind them that a large percentage of people who go to college don’t end up necessarily working in the career they got their degree for. So, while it’s a good idea to attend college, it’s almost never a good idea to get in debt over your head for.

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